Congress gives up on averting sequester — for now

Mar. 1, 2013 - 09:22AM
|

Today marks the start of an $85 billion cut to the remainder of this fiscal year’s discretionary spending.

The widely feared and maligned cuts to defense and domestic spending, known as sequestration, were essentially triggered Thursday when the Senate killed two bills aimed at relieving their blunt force, and the House adjourned for the week.

As cable news networks showed House members leaving the Capitol, senators milled near the upper chamber before voting down separate Republican- and Democratic-crafted bills.

“How can a member of Congress go on a military base and look a soldier in the eye after what we did today,” Sen. Lindsey Graham, R-S.C., an Armed Services Committee member, told reporters after the votes.

Several Republican and Democratic senators told reporters they hope to pass something either voiding some of the cuts or providing the Pentagon more flexibility to enact the cuts as part of a measure to extend government spending beyond March 27, when a stop-gap continuing resolution expires.

Asked Thursday what comes next, Senate Majority Whip Sen. Dick Durbin, D-Ill., said, “There’s going to be a meeting at the White House tomorrow,” referring to a planned Friday meeting between President Obama and congressional leaders.

Asked if Congress can find a solution to the sequester cuts by March 27, Durbin said, “We can fix anything — if we have the will.”

Another grand bargain?

The sequester cuts will continue for a full decade — totaling more than a trillion dollars split between domestic and defense programs — if Congress fails to strike a long-term $1.2 trillion budget-cutting deal.

Durbin’s GOP counterpart, Senate Minority Whip Sen. John Cornyn, R-Texas, told reporters he wants lawmakers to return to the idea of a “big deal,” which would include other federal cuts, entitlement program reforms and other items.

But Cornyn and other GOP fiscal hawks remain opposed to raising any new federal revenues, which Democrats still insist be part of either a sequester-avoiding or big fiscal deal.

Asked about Cornyn’s desired big deal, the No. 3 Senate Democrat, Sen. Chuck Schumer of New York, said, “Well, if we have some revenues in it, it’s a great idea.”

The Cornyn-Schumer split reflects months of gridlock between the two parties over revenues and major domestic entitlement program reforms.

With renewed talk of tying the scheduled sequestration cuts to a big fiscal deal that has been elusive for two years -— and with the federal debt ceiling expiring — the Pentagon and U.S. defense sector are in many ways right back where they were in late December.

Shy of a small package that deals only with the sequestration cuts, the two parties must, to permanently void them, do what they have been unable to do since Obama took office and the GOP captured control of the House in 2010: broker a major deal on everything from defense spending to Medicare, Medicaid and Social Security reform to closing corporate tax loopholes and other tax-code changes.

Republicans and Democrats said Thursday they have talked with members of the other party about cobbling together pieces of some package to undo the defense cuts.

“I’ve had a lot of other senators calling me today” since publicly stating he is open to raising revenue as part of a bigger deal, so long as it includes major entitlement reform, Graham said. Their message: “Let’s rethink the big deal.”

“We’re not going to do revenue to fix sequestration,” Graham said. “I’m willing to do $600 billion more in revenue if they’re willing to do entitlement reform. ... The off ramp should be Republicans put revenue on the table to get the president close to the $1.2 trillion” in deficit-reduction measures mandated by the 2011 Budget Control Act to void all the sequester cuts.

Sen. Richard Blumenthal, D-Conn., said in an interview the lone way out of the sequestration dilemma is legislation crafted and supported by Democrats and Republicans.

“We’re going to continue working for a bipartisan coalition that avoids the harmful effects of the possible cuts,” the Senate Armed Services Committee member said. “We have to pull back the effects of sequestration, so we protect job creation, the economic recovery and our national security.

“But let me just say: It has to be a bipartisan solution,” Blumenthal added.

But several GOP senators signaled Thursday that they would be open to discussing new revenue if that would help avoid more cuts to planned military spending. That list includes Senate Armed Services Committee members Sen. John McCain of Arizona and Graham.

“I think we should look at the big deal,” Graham said as he headed in to vote. “And I’m willing to do some revenues.”

“I’ll do anything I can to see the sequester, as far as defense is concerned, is nullified,” McCain said. “We’re always glad to do a big deal. But the big thing right now is — big deal or small deal or medium bill, whatever it is —- to stop what’s happening to our military. So I have no preference.”

First up on the floor was a GOP measure, which was defeated 62-38.

The GOP bill would have allowed the sequestration cuts to be triggered on Friday. But Obama would have been required, by March 15, to submit a plan on how the executive branch would have enacted the twin $500 billion cuts to planned defense and domestic spending over the next decade.

The GOP bill would have allowed Congress to place that plan on a fast track if neither chamber objects by March 22. That would have averted the March 27 deadline.

Any defense cuts in the president’s plan would have had to mesh with the 2013 National Defense Authorization Act, which already has been signed into law by Obama.

Minutes later, a Democratic-crafted measure went down 51-49.

The Democratic measure, unveiled Feb. 14, would have mandated $55 billion in additional spending cuts and $54 billion in new tax revenue. It built on Obama’s and congressional Democrats’ preferred kind of package: a so-called “balanced approach” of cuts and revenues.

The Democratic bill would have split its mandated cuts between national defense accounts and non-defense accounts. It called on the Pentagon’s annual budget to be slashed by $27.5 billion in the outyears, with an identical amount coming by terminating some agriculture subsidies. It would not have cut the DoD budget in 2013.

McCain said he believes lawmakers might be prompted to act after spending some time back in the home districts and states. As they hear from constituents, especially ones where the military and industrial base have a major presence, it could spur compromise, he said.

“I think the effects of it are going to be felt fairly soon, and that motivate us to revisit this,” McCain said. “But now, I think it has to come from outside sources.”